Boeing met with employees in Wichita this morning and confirmed the facility's closure. The company had said in November it was weighing the future of the Wichita factory due to expected cuts in U.S. military spending.
"The decision to close our Wichita facility was difficult," Mark Bass, a vice president for Boeing's defense division, said in a press statement.
Bass said Boeing decided to close Wichita "to reduce costs, increase efficiencies and drive competitiveness" in light of defense budget cuts. Boeing's Kansas facility has been in operation since 1929.
The Chicago-based aerospace company won a $35 billion contract to supply the U.S. Air Force with aerial refueling tankers last February. Boeing will build the 767-based aircraft at its Everett facility.
The company had planned to install military applications on those tankers in Wichita. In December, however, Boeing made an agreement with the Machinists union to shift that tanker work to the Puget Sound region if Wichita were to close.
Boeing employs more than 2,160 workers in Wichita. Employees there have worked on international tankers, including ones for Japan and Italy. They maintain government aircraft, including Air Force One, and update B-52s.
Bass estimated the company will add about 200 workers in the Puget Sound region for tanker work, though Boeing hasn't determined specifically where the work previously done in Kansas will be performed. Bass also said that Boeing will shift 100 jobs from this region to Oklahoma City -- mostly engineers who do global transport work for the company's defense division.
Future aircraft maintenance, modification and support work will be done at the Boeing facility in San Antonio. Additional engineering work will be transferred from Wichita to Oklahoma City.
Boeing estimates that San Antonio will receive about 300 to 400 jobs, while Oklahoma City will get 800. Some of the positions will be filled by workers relocating from Wichita, Bass said.
The company said it will begin shutting down the Kansas facility in the third quarter of 2012 and will finish by the end of 2013.
When Boeing was competing for the tanker contract, the company had said a tanker win would support 7,500 direct and indirect jobs in Kansas. Politicians there have said Boeing's decision to move tanker work out of Kansas would compromise the company's public trust.
Unsurprisingly, Kansas Gov. Sam Brownback called Boeing's announcement "disappointing."
"No one has worked harder for the Boeing Co. than 'Team Kansas,'" Brownback said at a news conference Wednesday.
Brownback emphasized that Boeing's suppliers will continue to do work in the state. The Kansas governor said he believes the state will still have a strong aerospace industry in the future but the work will focus more on commercial rather than defense business.
U.S. Sen. Jerry Moran, R-Kan., expressed outrage over Boeing's decision in a press statement.
“A company so much a part of the Wichita community for 80 years should not make this decision lightly," Moran said. "I strongly urge Boeing's senior leaders to reconsider this decision that will have a devastating impact on hundreds of Kansas families."
Boeing executive Bass said the company will continue to have a significant impact on the Kansas economy and the health of the state's aerospace industry.
"The company spent more than $3.2 billion with approximately 475 Kansas suppliers in 2011, spanning its commercial and defense businesses, making it the fourth largest state in Boeing's supplier network," he said.
In Everett, where the tankers will be assembled, Mayor Ray Stephanson called the Wichita closure "bittersweet."
"Mayor Carl Brewer of Wichita supported my call to mayors throughout the nation to support an American-built tanker," Stephanson said. "I was grateful for his support and am saddened for the workers and families in Wichita. That said, Everett stands ready to support additional aerospace work in the Puget Sound Region."
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